Liaoning Desalination Plant

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In September 2004, Singapore-based Hyflux signed a 30-year contract with Liaoning Zhengye Enterprise Group, to develop, build, own, operate and transfer the first seawater desalination plant in Liaoning province. The desalination plant was to have an initial capacity of 50,000 cubic meters per day when completed in 2006 and the company had planned to expand the plant's capacity to 100,000 cubic meters per day after 2008. Huludao was situated in southwestern Liaoning province on the bank of Bohai Bay. To implement the contract, Newspring (Huludao) was created as the project company which was owned by Hyflux (49%) and the state-owned Liaoning Zhengye Group Real Estate Development Co Ltd. Ashcraft Holdings was to hold the remaining 2% stake. The Zhengye Group's investment was composed of land and capital while Hyflux's investment was composed of technology, equipment and capital worth 230 million yuan. In addition, the Huludao Municipal People's Government was to provide a US$6.05 million credit to the project, while a local bank committed to lend US$4.65 million. None None